Correlation Between Binasat Communications and Dataprep Holdings
Can any of the company-specific risk be diversified away by investing in both Binasat Communications and Dataprep Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Binasat Communications and Dataprep Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Binasat Communications Bhd and Dataprep Holdings Bhd, you can compare the effects of market volatilities on Binasat Communications and Dataprep Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Binasat Communications with a short position of Dataprep Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Binasat Communications and Dataprep Holdings.
Diversification Opportunities for Binasat Communications and Dataprep Holdings
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Binasat and Dataprep is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Binasat Communications Bhd and Dataprep Holdings Bhd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dataprep Holdings Bhd and Binasat Communications is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Binasat Communications Bhd are associated (or correlated) with Dataprep Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dataprep Holdings Bhd has no effect on the direction of Binasat Communications i.e., Binasat Communications and Dataprep Holdings go up and down completely randomly.
Pair Corralation between Binasat Communications and Dataprep Holdings
Assuming the 90 days trading horizon Binasat Communications Bhd is expected to under-perform the Dataprep Holdings. But the stock apears to be less risky and, when comparing its historical volatility, Binasat Communications Bhd is 1.58 times less risky than Dataprep Holdings. The stock trades about -0.02 of its potential returns per unit of risk. The Dataprep Holdings Bhd is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Dataprep Holdings Bhd on October 16, 2024 and sell it today you would lose (3.00) from holding Dataprep Holdings Bhd or give up 17.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Binasat Communications Bhd vs. Dataprep Holdings Bhd
Performance |
| Timeline |
| Binasat Communications |
| Dataprep Holdings Bhd |
Binasat Communications and Dataprep Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Binasat Communications and Dataprep Holdings
The main advantage of trading using opposite Binasat Communications and Dataprep Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Binasat Communications position performs unexpectedly, Dataprep Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Dataprep Holdings will offset losses from the drop in Dataprep Holdings' long position.| Binasat Communications vs. IHH Healthcare Bhd | Binasat Communications vs. YTL Hospitality REIT | Binasat Communications vs. Hong Leong Bank | Binasat Communications vs. Melewar Industrial Group |
| Dataprep Holdings vs. Aurelius Technologies Bhd | Dataprep Holdings vs. Nova Wellness Group | Dataprep Holdings vs. Uchi Technologies Bhd | Dataprep Holdings vs. Dufu Tech Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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